Power and Renewables Brazil: Sweet dreams

Jun 28, 2013

Brighter forecasts and new measures from Brazil’s government should help sugar and bioenergy producers, which have been pinched in recent years

By Ben
Miller

Lower prices have taken a toll in recent years on sugar
producers in Brazil, which accounts for 40% of the
world’s production. But things may be looking up
as companies diversify and the government considers fresh
support measures.

It’s an industry where scale matters. But while
it’s been largely a game for the biggest players,
smaller companies have also managed to stay their ground.

An industry that not many years ago was still largely
family-owned has seen the arrival of international names like
Shell, Louis Dreyfus, Cargill, and Noble to both the sugar and
biofuel sides of the business. Indigenous Cosan has built
itself up to dominate the market. Big producers crush 50
million tons a year, though for many single-mill operators,
that sum is less than 10 million.

In the past two years, however, a group of medium-sized
producers has also found its...